Sequester ensnares government watchdogs

Mar. 18, 2013 - 05:29PM
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As lawmakers clamp down on federal spending, they aren’t sparing the government’s watchdogs.

Like the agencies they oversee, many inspectors general are absorbing steep across-the-board budget cuts officially known as the sequester.

And some are warning their oversight work is suffering as a result.

“We’re already turning down cases,” Kathleen Tighe, the Education Department’s inspector general, told a House panel March 5. “We’re shifting priorities. We’re telling our criminal investigators in the field that they can only open the highest-priority things, and they’d better, you know, watch what they do.”

Among other cost-cutting steps, Tighe plans to furlough her entire staff of about 270 — including herself — for up to 11 days.

Furloughs won’t be needed at the Transportation Department’s inspector general, both because of aggressive cost-cutting and because the office gets special funding stemming from the 2009 stimulus act and Superstorm Sandy, according to IG Calvin Scovel. But the size of the agency’s workforce, fewer than 400 employees, is the smallest since passage of the 1978 Inspector General Act, Scovel said at the same hearing of the House Oversight and Government Reform Committee.

“Sequestration will impact our office,” he added without elaborating.

How many of the other 71 IG offices are drafting furlough plans is unclear, but representatives at several said they are cutting back on hiring, travel and other expenses. While the Department of Homeland Security’s inspector general hopes to avoid unpaid time off for its 740 employees, “we haven’t made any decisions,” spokesman Bill Hillburg said last week.

Throughout government, the sequester is costing IG offices more than $100 million this year, said Scott Amey, general counsel for the Project on Government Oversight, a nonprofit watchdog group, in an email. Considering the billions of dollars in potential savings that IGs identify, Amey said, the government “is looking a penny-wise and a pound-foolish.”

David Kotz, a former Securities and Exchange Commission IG now with Berkeley Research Group, a consulting firm, said the cuts will likely undermine needed government oversight. “Many IG offices are very leanly staffed. If you start furloughing people or cutting contracts, it could definitely have an impact on their ability to conduct oversight,” he said.

The IGs are not the only government watchdogs suffering from the sequester, which generally imposes a 7.8 percent cut on most Defense Department accounts and a 5 percent reduction on non-Defense agencies. While the Government Accountability Office, an arm of Congress, hopes to avoid furloughs, its workforce of fewer than 3,000 is at its lowest level since 1935, and sequestration will require further reductions, Comptroller General Gene Dodaro said at a separate congressional hearing last month.

The cuts will hurt GAO’s work “at a time when Congress needs us most, given the federal government’s fiscal position,” he said.

Because IGs continually monitor their agencies and can also undertake criminal investigations, they provide a critical line of defense against waste and abuse of taxpayer money.

In fiscal 2011, the last year for which complete numbers are available, judgments, recoveries and voluntary repayments resulting from the IG community’s work amounted to more than $9.1 billion, according a report from an umbrella council for the inspectors general. Governmentwide, agencies could save or recoup some $67 billion if they fully implemented all of the pending recommendations from their IGs, the House oversight panel found in a separate review released this month. That figure is more than twice the 2009 total.

The sequester is an outgrowth of the Budget Control Act, signed in August 2011 as part of a trade-off to raise the government’s borrowing limit. The first round of cuts began taking effect March 1 and will continue through the end of the fiscal year in September unless lawmakers and the Obama administration agree on a different route.

Not all IGs are affected. Because lawmakers exempted the Veterans Affairs Department from the cuts, the VA inspector general’s office is operating at normal funding levels, a spokeswoman said.

Some IGs have also sought to temper the bite by getting a head start.

Beginning in August 2011, Scovel’s office froze hiring and has also stopped paying bonuses, dropped rental space and withdrawn from a student loan repayment program for employees. “Across the board, we have sought to cut every single expense we possibly could,” he said.

Because of previous funding cuts, the Health and Human Services Department IG froze hiring in February 2012 and also used $25,000 buyouts and an early retirement offer to cut employment from 1,800 to 1,660, with more reductions ahead, a spokesman said.

Since early 2012, the General Services Administration’s IG office, which gained fame last April with its audit of GSA’s 2010 Western Regions Conference in Las Vegas, has been hiring only one employee for every four who leave, spokeswoman Sarah Breen said. As a result, the IG’s workforce is down approximately 15 percent to 275. At this point, Breen said, the cuts have not hurt the agency’s ability to do its job.

But this year’s sequester is only the first of nine on track to occur each year through 2021 under the Budget Control Act.

“If this were to continue,” she said, “it would impact our mission to provide oversight of GSA’s programs and activities.”